Thursday, 28 June 2007

The Monarchy -- Value for Money

Today saw the publication of the Royal Finances Annual report, which includes details of public expenditure. Once again the report revealed that the cost of the Monarchy to each UK taxpayer is a mere 62 pence per annum, which is the approximate cost of a chocolate bar or, to quote the Buckingham Palace press release, is "less than the price of two first class stamps". When one considers that in exchange for this paltry sum Britain receives the benefits of 1,000 years of stability and continuity, including the world's oldest democratic constitution, one really must consider this the deal of the century. The deal is even better for tax payers in Her Majesty's other realms as they do not have to bear any of these costs (although they must bear the costs of their own Governors-General, Governors, Lieutenant Governors, State Governors etc., as well as the costs incurred during a Royal Homecoming)

The Report demonstrates that the Monarchy continues to bring value for money and as an institution is as far removed from the image of extravagance and proflicacy portrayed by its unfair critics as it is possible to be. Despite rising inflation and other increased costs, wise fiscal management by Sir Alan Reid, Keeper of the Prviy Purse, has resulted in expenditure for 2006-07 of £37.3 million, 0.3% lower than in the previous year. Indeed, Sir Alan reports that "the total cost of the Monarchy is now 7% lower in real terms than it was in 2001. The reduction in the amount of Head of State expenditure reflects the continuous attention the Royal Household pays to obtaining the best value for money in all areas of expenditure."

A reduction of expenditure by 7% since 2001 is truly remarkable when one considers the very significant costs that the Monarchy has had to bear in recent years, not the least of which is the cost of increased security necessitated by the events triggered by the terrorist atrocities of September 11, 2001.

But it gets better. Sir Alan Reid continues: "In the current year there was a real decrease in expenditure of 2.7% due mainly to a reduction in refurbishment costs at the Palace of Holyroodhouse, offset by increased costs in dealing with a greater number of Freedom of Information enquiries."

Republicans often cite the cost of the Monarchy as an argument in favour of abolition, however, realistically, any British republic would require the creation of an office of "President" and the establishment and maintenance of such an office would be far from cheap, particularly when compared with the very reasonable cost of our modern Monarchy. Certainly the cost per person of the French and United States presidencies far exceeds 62 pence per person see HERE (and HERE).

Of course it must also be stressed that, in reality, the Monarchy does not cost taxpayers anything. In 1760 King George III agreed to surrender his income from hereditary revenues such as the Crown Estate in exchange for funding from the Civil List, which was funded by taxation. These hereditary revenues of the Crown, the proceeds of which now pass directly into state coffers, far exceed the sum of the annual Civil List.

For example, the Crown Estate alone generates annual revenue of approximately £200 million for the Treasury. If one substracts the £37 million pound annual cost of the Monarchy from this sum, the Monarchy benefits the Treasury (and the nation) to the tune of approximately £160 million per annum.

Criticising the cost of the Monarchy does become difficult when faced with such facts!

1 comment:

If chincy republicans want to focus on these minor state costs, let them. My advice to monarchists is to focus on the revenues. How much do you suppose the royals are bringing in to the economy by virtue of their existence. (Hint: it's in the billions of pounds)

The fact is that the British Monarchy is a revenue-generating cash cow, and I'm not just talking about the tourism industry here. The republicans could embellish the Royal Family's expenses all they want; throw in the Royal Yacht Britannia even, pile on all of their security costs and sovereign bodyguards, add the costs of maintaining all of Her Majesty's regiments, royal residences and state palaces, you name it - they still wouldn't be able to attribute one net expense to the Royal Finances.

But even if they could, even if it did cost a pretty penny, it would be worth it. As Aristotle said, on the quality of magnificence a gentleman does not count the cost. We should spend lavishly on the Crown.